One of the most important factors you have to consider when choosing a credit card is the interest. Interest, which is the credit card company’s primary source of revenue, is a percentage of money that is added to your total credit bill. The interest rates for each type of credit card may vary depending on the policies employed by the credit card company. Here are the two types of credit card rates used in Alberta:
Variable APR credit card rates
Variable being the operative word, credit cards with variable APR rates have flexible interest rates. The rate of interest added to your regular credit bills is based on the current status of the economy. Interest rates decrease when the economy is performing well, but they increase when the economy is performing poorly. Because it is subject to change, the initial interest rate in credit cards with variable APR rates are relatively low. This interest rate, however, will only remain low if the economy continues to perform well.
Fixed APR credit card rates
If you want stability, then you should probably go for credit cards with fixed APR rates. The interest rates in fixed APR types of credit cards, unlike variable APR credit cards, are not dependent on the current performance of the economy. Regardless of the fluctuations in the economy, the interest rates in fixed APR credit cards will remain unchanged for the life of the credit card. Because its interest rates are not affected by any economic performance or financial change, credit cards with fixed APR rates feature relatively high starting interest rates.
The two types of interest rates used in Alberta both have their own strong points and weak points. It is quite impossible to pinpoint which one is better than the other. To help you make your selection, however, you have to determine which one suits your interest best: Do you want more flexibility or stability?